The Bernard Madoff’s Fraud Essay Example for Free

The Bernard Madoff’s Fraud Essay Madoff’s scheme to defraud his clients at Bernard Lawrence Madoff Investment Securities began as early as 1980 and lasted until its exposure in 2008. Bernard carried out this scheme by soliciting billions of dollars under false pretenses, failing to invest investors’ funds as promised, and misappropriating and converting investors’ funds to benefit Madoff, himself, and others without the knowledge or authority of the investors. To execute the scheme, Madoff solicited and caused others to solicit potential clients to open trading accounts with Bernard Lawrence Madoff Investment Securities (BLMIS) on the basis of a promise from him. He promised to use investor funds to purchase shares of common stock, options and other securities of large, well-known corporations, and representations that he would accomplish high rates of return for client, with limited risk. â€Å"United states of,† 2009) Among other things, Mandoff marketed to clients and prospective clients an investment strategy referred to as a split strike conversion strategy. Clients were promised that Bernard Lawrence Madoff Investment Securities (BLMIS) would invest their funds in a basket of approximately 35-50 common stocks within the Standard Poors 100 Index (the SP l00), a collection of the 100 largest publicly traded companies in terms of their market capitalization. Mandoff claimed that he would select a basket of stocks that would closely mimic the price movements of the SP 100. Mandoff further claimed that he would opportunistically time those purchases, and would be out of the market intermittently, investing clients funds in these periods in United States Government issued securities such as United States Treasury bills. Madoff also claimed that he would hedge the investments that he made in the basket of common stocks by using investor funds to buy and sell option contracts related to those stocks, thereby limiting potential losses caused by unpredictable changes in stock prices. â€Å"United states of,† 2009) Madoff’s Illegal Business Behaviors Exposure Federal prosecutors filed a total of eleven charges against Bernard Madoff. The first of those charges was for securities fraud. The crime of securities fraud involves false claims of investment security holdings, and misinformation regarding stocks and brokerage advice. Sensational insider information is also considered a component of this criminal activity. Another major charge involved t hree counts of money laundering, both domestically and through international accounts. Money laundering is the funneling of revenue acquired illegally into new monetary arrangements, with the intent of concealing this revenue’s original origins. Plus, in connection with both his securities and investment adviser businesses, prosecutors also charged Madoff with mail and wire fraud. These offenses involve initiating schemes using either the United States Postal Service or telephone systems toward obtaining money and/or property in a false or unlawful manner. (Tomaszewshi, 2010). Perpetrators Involved in Bernard Madoff’s Fraud It’s certainly not uncommon for one’s son or daughter to enter into an identical business relationship as a successful family member such as a parent. However, in Bernie Madoff’s case this approach was taken to extreme levels of nepotism. Peter Madoff entered his brother’s firm in 1967, and as business prospered he began to accumulate several executive titles: Senior Managing Director, Head of Trading, and even Chief Compliance Officer for both the broker-dealer and more secretive investment advisor business models. Bernie’s sons Mark and Andrew joined the firm in the mid-to-late 1980s, and eventually were made co-directors of Madoff Securities International in London, England. Bernie’s nephew Charles joined up in 1978, and became the Director of Administration for the investment firm. And Peter’s daughter Shana was hired on in 1995, and served as in-house Legal Counsel and Rules Compliance attorney for the broker-dealer business. Other parties greatly impacted by Bernie Madoff’s activities were his business associates and their many clients over the decades. For example, Frank Avellino and Michael Bienes themselves funneled over three thousand clients to Madoff’s investment advisory business. Madoff had consistently advised the pair to remain unregistered in their dealings. But when the SEC accused the duo of illegally selling securities, Madoff pretended ignorance of their activities, even though he had secretly instructed them all along. For their trouble, Avellino and Bienes were forced to pay a fine of three hundred and fifty thousand dollars and shut their business down. Other notable business partners eventually left in the lurch by Madoff’s growing fraud would go on to include Jeffrey Tucker and Walter Noel of Fairfield Greenwich Group. Non-related people who had worked under Bernie Madoff also became tainted from the association following his arrest. This employee group includes those who may have had indirect dealings through Madoff subsidiaries like Cohmad Securities Corporation. However, the idea also applies to those employed directly, such as former executive assistants Elaine Solomon and Eleanor Squillari. Jeffry Picower was in industrialist and philanthropist who seemed to be a favored Madoff beneficiary, and made outlandish profits from his investments with Madoff. From 1996-2007 there were 14 instances of greater than 100% yearly returns and 25 of greater than 50%. From 1996-1999 his regular trading account made from 120-550% a year. Some evidence of backdating trades, instituted by Picower, has been presented by trustee Irving Picard. In December, 2010, his estate returned $7. 2 billion in profits to the government. Picower died before the settlement. Tomaszewshi, 2010) Motives of the Perpetrators The various perpetrators who were involved in Bernard Madoff’s ponzi scheme had different kinds of motives that were completely against the provisions evident in federal laws. Jeffry Picower had over twenty four different accounts with Investment Securities L of Jeffry Picower and his wife in Investment Securities LLC was to benefit from the cash windfall generated from devious deals according to reports; his investment into Madoff’s company was once worth over one billion dollars. Kirchner, 2010) Annette Bongiorno was a senior employee at Bernard Madoff’s illegal company and among her roles at the firm she was to brief investors concerning their returns which were all fictitious. Ezra Merkin was an investment expert who assisted Bernard Madoff to drain off extraordinary amounts of money from clients’ accounts and it later emerged that he had a conflict of interest in the Madoff company. With its headquarters in Connecticut, Fairfield Greenwich Company misled investors into buying stakes at Madoff‘s illegal firm and in return, the company received huge amounts of cash from Bernard Madoff. NBC, 2009) Frank DiPascali was also another essential figure in Bernard Madoff’s illegal investment scheme. One of the frauds committed by Frank is that he engaged in countless number of international money laundering activities to benefit Madoff’s scheme. In addition to this, DiPascali also gave Mr. Madoff expert advice on how to go about his illegal businesses without being caught or detected by the federal authorities. (Arvedlund, 2010) (â€Å"Bernard Madoff fraud,† 2012) Controls That Could Have Deterred the Fraud from Occurring Despite the fact that Bernard Madoff’s investment fraud was one of the largest to ever rock the United States of America, there are various strategies thatLC and he operated them closely with Barbara who was also his wife. The motive might have prevented or deterred the fraud from occurring. To begin with, the United States Securities and Exchange Commission (SEC) should have without delay acted on the numerous signals that it received from different quarters. As the main regulatory authority of American investment activities, it would have been easy to identify weaknesses in Bernard Madoff’s shady deals. A major loophole in the federal laws of the United States of America also had a significant input towards enabling Bernard Madoff’s illegal activities to spread at a very rapid rate; for instance, there is a provision that stipulates private companies in the United States should only pay 5% of their annual revenues. (NBC, 2009) (â€Å"Bernard Madoff fraud,† 2012) Implementations That Investors Should Have Used to Protect Themselves While some investors may yet believe they were tricked into believing Bernie Madoff’s elaborate confidence game, it is also arguable that there were means to protect themselves at their disposal. One method would be to practice due diligence whenever one is presented with new financial opportunities. Many investors were led astray on the poor advice of their won friends and family, which isn’t a fiscally sound means of verification. Independent research needs to be done on the workings of any financial organization, even those that are supposedly reputable on the surface. One should investigate third-party custodial relationships at investment firms, and review their auditing practices. (Tomaszewski, 2010) Another way to avoid fraud is to actively request documentation. Hand written notes from intermediaries are highly suspicious evidence that revenue is being transacted in a professional manner. Getting activity in writing must be joined to verifiable account numbers for auditing. Finally, a forceful amount of skepticism will often prevent one from falling into schemes which seem on the surface to be easy money generators. For instance, one should never believe the speculators on television. An unlicensed financial consultant is about as reliable an agent as allowing unreformed gambling addict free access to one’s personal treasury. Investors should not assume that overseers are actually doing their jobs, as even they might be in on the take. (Tomaszewski, 2010). The United States Securities and Exchange Commission (SEC) Involvement Critics and popular journalists from prominent media houses in the United States of America have called into question the manner in which the Securities and Exchange Commission handled the fraud case involving Bernard Madoff. This is due to the fact that even the commission itself has acknowledged that it should have detected Madoff’s illegal activities as soon as they began. The first major mandate or responsibility of the Securities and Exchange Commission is to interpret the laws pertaining to federal securities; such as, the commission should have detected the fundamental flaws in Bernard Madoff’s investment activities at an earlier stage. The second major responsibility of the Securities How Madoff’s Fraud was Discovered and Identifiable Red Flags His business came to be under the doubts of various financial analysts as early as 1999. They believed that the returns claimed by the company were only theoretically impossible. But organizations such as the Securities and Exchange Commission (SEC) completely ignored the doubts and Madoff continued with his overtures for almost another 10 years. He finally got caught in December 2008. He was trapped after he confessed about his dishonesty to his very own sons. He confessed to his sons of his investment business being nothing but a big Ponzi scheme. His sons now reported his father’s fraud to the Federal Bureau of Investigation. Though Bernie confessed to have had started his Ponzi scheme in the 1990’s, investigators think otherwise. They believe the Ponzi scheme and defrauding of investors had begun in the 1980’s itself. Now what actually happened was that in the very first week of December 2008, Bernie Madoff discussed his dilemma over having to pay his clients an amount of almost $7 billion as he didn’t have that much funds. Now within the very next two days Bernie told his sons that he made a huge profit and had decided to give away an early bonus, amounting up to $173 million. This confused the sons and they called for an explanation from their father. This is when their father confessed that his whole company worked through a â€Å"giant Ponzi scheme†. On December 11th 2008, Bernie Madoff was taken into house arrest. Had the stock market not had been in a sharp decline in 2008, who knows how much longer the fraud could have continued. (Degrace, 2011) After writing that Madoff offers the biggest due diligence lesson for investors, some argued that the red flags are only obvious in hindsight and wouldn’t have been so clear if one had to make the decision before Bernard’s admission of running a Ponzi scheme.

Chap.7 State Of The World :: essays research papers

Critical Analysis on Chapter 7, State of the World 1999 Feeding Nine Billion   Ã‚  Ã‚  Ã‚  Ã‚   While reading chapter 7 of State of the World I was very interested in the changing course because it made me think about the things that our world can do that can drastically benefit the future of our agricultural production and food prospect. We must be able to solve the two major food issues currently facing our world, which are malnutrition and price stability. All governments need to establish a population policy so that their country does not exceed the limitations of its carrying capacity. It is important that we can produce enough food for our country, which is estimated to increase by 74 million in the next fifty years. A quote from the book, â€Å"The worst mistake political leaders can make entering the new millennium is to underestimate the dimensions of the food challenge†. I certainly agree with this because most of the future food growth in the world is going to be croplands and we need to understand that we are going to need to be able to produce as much crop as possible for the land. I also agree with the fact that the governments that are experiencing rapid population growth must figure out their future population carrying capacity by calculating how much land is available for crops and how much water is available for irrigation. It is estimated that 3.3 billion more people will be living on this world in the first half of the next century and unfortunately many of those people will be born into already over populated countries. For example, India with some of the highest poverty rates in the world will have an additional 600 million people inhabiting the country by the year 2050. It was interesting to learn that educating young females would be a good way to control future population growth because â€Å"the more education that women have, the fewer children that women have†. Another way to ensure food supply in the future according to the book is to eat food in moderation to keeping a healthy diet, which helps conserve food, and at the same time keeps you healthy. I definitely do not agree with this approach because even though it would work with everyone’s cooperation, you are not going to get everyone’s cooperation because there are still all those people who love to eat and they don’t care if they are overweight or obese. Chap.7 State Of The World :: essays research papers Critical Analysis on Chapter 7, State of the World 1999 Feeding Nine Billion   Ã‚  Ã‚  Ã‚  Ã‚   While reading chapter 7 of State of the World I was very interested in the changing course because it made me think about the things that our world can do that can drastically benefit the future of our agricultural production and food prospect. We must be able to solve the two major food issues currently facing our world, which are malnutrition and price stability. All governments need to establish a population policy so that their country does not exceed the limitations of its carrying capacity. It is important that we can produce enough food for our country, which is estimated to increase by 74 million in the next fifty years. A quote from the book, â€Å"The worst mistake political leaders can make entering the new millennium is to underestimate the dimensions of the food challenge†. I certainly agree with this because most of the future food growth in the world is going to be croplands and we need to understand that we are going to need to be able to produce as much crop as possible for the land. I also agree with the fact that the governments that are experiencing rapid population growth must figure out their future population carrying capacity by calculating how much land is available for crops and how much water is available for irrigation. It is estimated that 3.3 billion more people will be living on this world in the first half of the next century and unfortunately many of those people will be born into already over populated countries. For example, India with some of the highest poverty rates in the world will have an additional 600 million people inhabiting the country by the year 2050. It was interesting to learn that educating young females would be a good way to control future population growth because â€Å"the more education that women have, the fewer children that women have†. Another way to ensure food supply in the future according to the book is to eat food in moderation to keeping a healthy diet, which helps conserve food, and at the same time keeps you healthy. I definitely do not agree with this approach because even though it would work with everyone’s cooperation, you are not going to get everyone’s cooperation because there are still all those people who love to eat and they don’t care if they are overweight or obese.

Miracles – Philosophy

Philosophy- â€Å"A belief in miracles leads to the concept of a god who favors some but not all his creation† The problem with miracles is that it cannot be properly defined which means there is no absolute meaning for a meaning, instead my philosophers have attempted to define miracles in their own way. In these definition they are usually for or against the existence of miracles, for example take two contrasting definitions Ward and Hume. Ward says miracles are events which god intervenes because he only knows the consequences of the action.On the other hand, Hume is a philosopher who is totally against the idea of miracles, he says miracles do not exist because they violate the laws of nature. Knowing this, god cannot intervene because he would violate the laws of nature, humans have faith in experience and trust the laws this would be lost if miracles were deemed true. Another philosopher would had a problem with miracles was a man called Wiles. He basically said, to say god carries out these miraculous events is to say god is guilty of obituary and partisan.Any event where the natural flow is violated for a certain people raises the issue of fairness and consistency. Wiles also said the two idea of having an all loving god and the existence of miracles are two incompatible ideas so its easier to believe that god is all loving and reject the idea of miracles. If this was in reverse and miracles existed and god could intervene then why didn't he intervene is horrific events such as Auschwitz or Hiroshima instead he saves one persons life, this seems unfair and a contradiction of an all loving god.As for biblical miracles Wiles said we must take them in a symbolic sense rather than a literal sense. A strength of Wiles it that allows educated believers to keep faith with god and uphold their faith in natural laws. Many people agreed with what Wiles was saying for example a man called Bultman agreed that the miracles explained in the bible are not there to take literal, he says we get the true message behind the miracle if we demythologize them.For example he turned water into wine to prevent the embarrassment of the hosts which shows his care and wisdom. To believe that god favors some more than others through the existence of miracles is wrong, who says its god that these events originates? We have no evidence to suggest this, just because we cannot find this would doesn't mean we have to point it to god. Holland was another philosopher who didn't believe in the concept of miracles, well the name miracle he thought that they were more of a coincidence.He used the analogy of the train, what is some one was stuck on the track and the train had stopped right in front of the person, some people may call this a miracle but when we know the full picture someone in the train may have accidentally pressed the emergency stop or the driver could have passed out. So the concept of the whole miracles thing may just be one big coincidence. L ooking at Holland’s view it would make god innocent of being arbitrary and partisan, this is because these events are just coincidences it has nothing to do with god.As mentioned earlier, Hume was a man who rejected the idea of miracles due to being a violation of the laws of nature. Hume believes strongly in experiences and what we gain from them, as for this situation, the laws are something we have learnt about and follow. So when something happens that goes against these we deem them coming from god because we cannot define or justify them. All in all, Hume says the alert of miracles comes from the ignorant and barbarous nations. Knowing this, God would also be innocent because it is not god who intervenes so its not him which favors some and not others.There are events that are unexplained so they must come from some where, lets say for arguments sake tat they come from god. Us as humans are not on his level therefore we cannot say or he is this or that, he may have a re ason and we would find out when we die. All the events that are unexplained may paint a bigger picture but humans are outside of god knowledge and experience so we cannot really judge god. Irenaous was a philosopher who looked at the problem of evil, he would say god is being cruel to be kind and making humans into the image of god, this because events like miracles change people.To develop these emotions naturally have more significance than being drilled in at birth by god. Overall, I conclude that God does not favor some people over others. My reasons for this is because we cannot define miracle we can only speculate on what we think, for this reason how can we act upon such uncertainty? Also we cannot judge god because we have no knowledge of him or what he has planned, only him and him only knows the repercussions of his actions.

Foods for Healthy Skin - 700 Words

Foods for Healthy Skin Lifestyle habits and genetics play a significant role when it comes to skin health, however; food has a notable contribution in making your skin healthier and at its best or worst as it already is. Choosing the right food can help the skin fight numerous skin problems such as acne, wrinkles and dermatitis. Some may opt to use different beauty products to achieve healthy skin but some of these may do more harm than good. Skin types may differ from person to person thus some beauty products may go well for some, while it can be worse for others. Healthy skin can still be achieved by just changing your daily diet. Choose foods that are known to be very beneficial for the skin health. Here are several food choices†¦show more content†¦Carrots If you want to keep your skin healthy, carrots might be the answer. Carrots have a sweet, minty aromatic taste and crunchy texture. It contains a valuable amount of antioxidants like vitamin C and beta carotene that helps in repairing skin tissue and acts as a shield against the sun’s harsh rays. Shredded or chopped raw carrots are a great addition to salads. Blending pureed carrots for creamy soup or serving it as part of healthy shakes is also a great way in incorporating it to your daily diet. Peppers In some research, women who consume green and yellow vegetables regularly tend to have fewer wrinkles than those who don’t. This may be because of carotenoids, which is an antioxidant that can be found in green and yellow vegetables, like peppers. Adding this nightshade vegetable in your diet can be beneficial for your skin. You can add it in salads, soups, casseroles or just eat it with dips. Pomegranates Pomegranates are packed with polyphenol antioxidants that fights free radicals and regulates the blood flow on the skin giving its rosiness. Eating one pomegranate fruit or a few glasses of its juice daily can help you achieve its full benefits. Fatty fish Fatty fish such as salmon, herring, anchovies, rainbow trout and mackerel contains omega-3 fatty acids that help in fortifying the skin cell membranes. It also protects the skin against sun damage as well as reducing the risk on certain form of skin cancers. These healthy fatsShow MoreRelatedThe Skin Of African Americans914 Words   |  4 Pagesthankful for the life you have and the skin you live in? The environment, food, and habits are different for everyone depending on where they live in the world. Americans have the ability to see the flexibility in these components, but other countries can not afford to change these factors to benefit their skin. The skin is the largest organ of the body, the Sudanese and American families must be able to promote a healthy lifestyle to maintain and enhance their skin. 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